Ontario Power Authority (OPA) and Independent Electricity System Operator (IESO) Energy Storage Procurement Framework

Posted: January 31, 2014 - 19:00 / Ontario / FOA-RFI-RFP

The proposed energy storage procurement framework specifies that 50 MW of energy storage will be included in procurement processes by the end of 2014 using a phased approach. Final MW procurement totals for each phase may change as a result of the response to the Phase I RFP. The OPA and IESO will work closely together throughout the procurement phases to maximize learning about energy storage services in the Ontario context.

Approximately 25-30 MW of energy storage services will be procured by the IESO during Phase I which builds upon the Alternate Technologies for Regulation (“ATR”) framework that the IESO used recently to contract with battery and flywheel vendors to supply regulation service. Contracts under Phase I would be executed by the end of June 2014. While this phase of competitive procurements would focus on reliability services, it is expected that many energy storage solutions selected will provide additional end-use services beyond the primary focus identified in the procurement – this will enhance the learning expected from these solutions.

Phase II of the energy storage procurements will be designed to address the emerging issues of the evolving electricity system as described in the Long Term Energy Plan (“LTEP”). It will focus on areas that can provide the best long-term benefit to the ratepayer while allowing maximum opportunities for storage suppliers to demonstrate their technologies. To do this, input from stakeholders will be required to develop the appropriate framework for achieving these goals and will include input on potential sites and alternate contractual arrangements. The timing will be designed to complement the Phase I process and to leverage learnings from that phase. The OPA will follow a multi-stage procurement process based on input from stakeholders, with it being initiated in Q1/Q2. The OPA will procure the remainder of the 50MW, which may include some consideration for remote communities.

The proposed framework also includes a plan to review the regulatory barriers to storage’s participation in Ontario’s electricity market and identify options for addressing these barriers. This effort will be carried out by the IESO and OPA in partnership with the Ontario Energy Board’s Smart Grid Advisory Committee - Storage Working Group.